ACA To RUS: e-Connectivity Broadband Pilot Program Has Tremendous Potential But Funds Must Not Be Spent To Overbuild Existing Providers

RUS Also Should Account For Other Federal Broadband Programs To Avoid Inefficiencies

PITTSBURGH, September 11, 2018 – To encourage private investment in broadband networks and protect taxpayers from the misallocation of federal technology grants and loans, the American Cable Association urged the Department of Agriculture’s Rural Utilities Service (RUS) to ensure that a broadband pilot program newly authorized by Congress targets funding only to areas where consumers currently lack access to broadband service and where other federal programs are not providing support.

ACA stressed that RUS can stretch the impact of each grant and loan dollar by coordinating with the Federal Communications Commission (FCC) and the Commerce Department’s the National Telecommunications and Information Administration (NTIA), thus ensuring that key federal agencies are working in tandem to identify areas that need support, which will accelerate the common objective of bringing broadband service to all Americans.

“In enacting the e-Connectivity pilot program, Congress further ensured that all Americans will have access to vital broadband service, but it expressly directed RUS to target support only to areas where there are no existing providers or in effect other federal support mechanisms. RUS now needs to implement the program consistent with these aims. By doing so, it will not only ensure that private investment in broadband networks will not be undermined, but it will spend limited federal funding most efficiently – in those areas where it is most needed.” ACA President and CEO Matthew M. Polka said.

ACA’s comments, filed Monday Sept. 10, came in connection with a Notice of Inquiry (NOI) issued by the RUS regarding the development of the Broadband e-Connectivity Pilot Program, which Congress enacted as part of the Consolidated Appropriations Act of 2018. The statute directs RUS to award grants and loans, totaling $600 million in the aggregate, for the construction, improvement, and acquisition of facilities and equipment for broadband service in eligible communities.

ACA noted that its concerns about the misallocation of broadband funding find support in relevant provisos contained in the statute. One states that funding should be made available only where at least 90% of the households to be served by a project do not have sufficient access to broadband, defined as 10 Mbps downstream and 1 Mbps upstream (10/1 Mbps), subject to annual reevaluation. And another says an entity to which a loan or grant is made shall not use the support to overbuild or duplicate expansion efforts made by an entity that has received a broadband loan from RUS.

As to determining whether households have “sufficient access” to broadband service, ACA submits that Congressional intent is clear that this term should only mean that existing broadband providers (mobile technologies not included) in the area are offering service with speeds of at least 10/1 Mbps.

If Congress wanted other factors or attributes of broadband service to be considered, it would have done so. If RUS determines that Congress intended other factors or attributes to be considered, RUS should follow the FCC’s paradigm and use the following factors: speed, latency, data usage, and affordability. Moreover, the inputs should be aligned with those used by the FCC. ACA also submits that RUS should presume that wireline network providers using DOCSIS or all-fiber technologies clearly meet the speed and latency benchmarks because they offer speeds that far exceed 10/1 Mbps at low latency.

Regarding, the collection of accurate data about the availability of broadband service, RUS can most efficiently achieve its objective of increasing the completeness and accuracy of data about existing broadband service, as well as ensure it does not waste funding or overbuild an incumbent, by adopting and implementing measures that are similar to, or build upon, those used by the FCC in the Connect America Fund (CAF) challenge process. The FCC’s challenge process sought to determine more accurately the unserved locations that would be eligible for CAF support by giving existing providers an opportunity to supply additional and much more specific information about where they are providing service in areas presumed to be eligible.

As to coordinating with other federal agencies’ broadband support programs, ACA recognizes that RUS understands the importance and value of accounting for other federal broadband support programs.

In general, greater coordination with other federal agencies distributing broadband funding will extend the reach of the limited support provided under the program and other federal programs and guard against waste. It is particularly important that RUS implement the program in sync with certain FCC universal service programs, such as the $2 billion fund that supports rate-of-return carriers in high-cost areas, and the CAF Phase II Support, which provides approximately $1.8 billion annually for support in areas the FCC has found to be unserved,

“In implementing the program, RUS should be cognizant of, account for, and coordinate with other federal broadband support programs so it brings broadband to those areas that are most unserved and does so with the fewest federal dollars,” ACA’s Polka said.

About the American Cable Association: Based in Pittsburgh, the American Cable Association is a trade organization representing about 800 smaller and medium-sized, independent companies that provide broadband, phone and video services to nearly 8 million customers primarily located in rural and smaller suburban markets across America. Through active participation in the regulatory and legislative process in Washington, D.C., ACA’s members work together to advance the interests of their customers and ensure the future competitiveness and viability of their business. For more information, visit:http://www.americancable.org/